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SAN JOSE -- Flextronics is denying reports it is seeking a buyer for its plant in northwest Shanghai, according to published reports.

Last week, rumors spread that the company, the world's second largest EMS firm, would close up to 12 factories worldwide. In response, Flextronics senior chief director for marketing and communications business in Asia Valeria Kurniawan debunked the rumors, saying that although some cost-cutting measures would be taken, the plants were not on the market.

Flextronics has two large assembly plants in the Shanghai area, one in Malu, in northwest Shanghai, and one in Pudong, across the river from downtown Shanghai.

MADISON, AL – STI Electronics Inc. has relocated to a 54,000 sq. ft. facility here, and plans to host an open house Jan. 29. The firm’s previous facility was 18,000 sq. ft.

STI says it is positioning itself for marked growth in 2009, increasing capabilities in all divisions. Engineering services will include a new SMT line. Training services is adding a third classroom and has plans to hire two additional instructors. Industrial tools and supplies has a new sales manager and three outside sales representatives.

In the analytical/failure analysis lab, STI has added a RADWAG MXA-5 microbalance, and has almost doubled the size of its Class 1000 cleanroom, which now included conformal coating capabilities.

STI plans to implement additional equipment and add capabilities and staff throughout 2009.

SMYRNA, GA – UP Media Group Inc. announced the addition of Sunstone Circuits and Intercept Technology to the list of industry companies that have signed on to exhibit at Virtual PCB, the industry's only virtual trade show and conference for the PCB design, fabrication and assembly markets.

Now in its second year, Virtual PCB takes place Feb. 24-25.

Among the other companies exhibiting to date are Agilent Technologies, Bare Board Group, BTU International, DownStream Technologies, EKRA, Mentor Graphics, Miyachi Unitek and Valor Computerized Systems.

Virtual PCB, which drew 2,400 registrants to its premiere, offers complete, real-time tracking of attendees, product demos and a technical conference supplemented by the Surface Mount Technology Association, and features a host of experts.

"Despite the economy, or perhaps because of it, sophisticated companies are looking for additional high-impact ways of reaching the market. Over-sized, over-priced and over-scaled trade shows are being abandoned in favor of more targeted, economical and higher impact avenues," according to Circuits Assembly Editor-in-Chief Mike Buetow. "Be it Web or trade show marketing, there simply is no better ROI than Virtual PCB."

A fully interactive, Web-based event, Virtual PCB incorporates all the critical features of a live event, while allowing PCB design, fabrication and assembly equipment and materials buyers and sellers to interact online. Virtual PCB is supported by a proven software platform and will be accessible on-demand for two months following the two-day live event.

For more information, visit www.virtual-pcb.com or contact Alyson Skarbek at askarbek@upmediagroup.com.

TAIPEI – The head of Foxconn Technologies today announced layoffs of up to 5% of its worldwide workforce, citing the economic environment.

ST. PETERSBURG, FL – Jabil Circuit today reported flat fiscal first-quarter revenues of $3.4 billion, while preliminary GAAP operating income plunged 21% from last year to $77.7 million.

SAN JOSE – Slowing demand for PCs and cellphones will stall the semiconductor industry recovery, a group of analysts predicted during SIA’s 2009 forecast Thursday.

The group of prognosticators asserted 2009 sales will be bleak relative to historical standards, with consolidation possible on the equipment side.

Among the bears was VLSI Research senior economist Aida Jebens, who forecasts a 6.9% drop in IC sales next year. “Growth will be flat, if not negative. Moreover, pricing pressure will flatten revenues even if unit shipments grow, she said.

VLSI’s price index shows ICs in “ really bad shape,” Jebens said.

Advanced Forecasting CEO Moshe Handelsman says worldwide IC revenues fell 2% in 2008, and predicts a larger decline for 2009.

Dale Ford, senior vice president, marketing intelligence at iSuppli Corp., says shipments will be down 4 to 5% for 2008 and will worsen next year. This deep decline should turn around in late 2009 to early 2010, he says, then rebound in 2010.

Calling 2009 a “year of austerity,” Infrastructure director of research Carl Johnson sees “unheard of declines” for components for PCs, which could be down 50% during the first half.

The analysts agreed inventories could become a problem in the coming year as OEMs pull back orders.

Slowing End Demand

Most see slowing demand for electronics. VLSI predicts an overall drop of 2.6% year-over-year in 2009, with PC shipments growing 3 to 5%, but negative growth for cellphones.

SEMI, meanwhile, says the notoriously cyclical semiconductor equipment market will fall 21% in 2009, following 2008’s 28% year-over-year drop.

Bookings and sales could fall to 2003-03 levels, pegging the overall capital spending at $22 billion. Equipment represents 12% of device revenue, “an all-time low,” says Lara Chamness, senior market analyst, industry research and statistics.

IC and related manufacturing equipment will be down 24.7%, VLSI predicts. iSuppli’s Ford thinks PCs will show modest growth, while flat-screen LCDs will be flat.

The overall economy will grow, but sluggishly. Ford projects GDP growth of 2.2% in 2009, noting some foresee a decline.

Infrastructure’s Johnson predicts a “big shakeout” in the industry. “It will be survival of the fittest. The longevity of the business model is really important right now.”

Whether governments will intercede remains unknown, but is a potentially huge factor. “At some point for the semiconductor industry, the government will take on a role, but that role is a significant unknown right now,” says Ford. “And it won’t be the same role globally. We will deal with trade issues and run the risk of trade wars.”

“Wall Street will not be the solution,” he added. “That door has closed.”

But they agreed that with much of the foundry work now in Asia, the pressure will be on foreign governments, particularly in Asia, to make decisions on bailouts.

Semiconductors have a future in photovoltaics, one area that has seen outside investment, but that sector too will be tied to government subsidies. As Ford says, “As energy prices come down, there will be less willingness to invest in alternative energy solutions.” Johnson agrees, stating photovoltaics would be a longer-term play. “The reality is we’re sitting on the solar business; the tree will shake, and the semiconductor business has a role to play in this.”

FORT COLLINS, CO – EMS firm RPM Electronics will shutdown by the end of February, putting 70 employees out of work, according to published reports.

The firm, founded in 2001 as RPM Technology, had recently lost business from two big customers – Advanced Energy Industries and Plasmon – which made up about half of RPM's sales.

Since March, RPM has been owned by RAD Electronics.

TOKYO – Panasonic Corp. shareholders have agreed to offer $9 billion for Sanyo, a deal that could make way for one of the world’s largest electronics firms. Investment bank Goldman Sachs, a major Panasonic shareholder, has agreed the to plan, according to reports. Sanyo would become a Panasonic subsidiary under the deal, which is expected to be completed by February.

Panasonic, which until recently operated under the name Matsushita, is the world’s fourth largest maker of electronics and electrical equipment, while Sanyo ranks 15^th. The combined company would have combined revenues of about $113 billion, ranking second, behind Siemens.

Sanyo’s profits dropped about 67% to $49 million in the September quarter. Panasonic's profit for the quarter fell 16% to $624 million.

STOCKHOLM – EMS provider NOTE has acquired all shares in Oslo-based electronics manufacturer Norteam Electronics AS, the company said. Financial details were not disclosed.

MEMPHIS -- Flextronics last night informed a local development board of its plans to invest $2 million in new and expanded electronics repair operations here.

The EMS company told the Memphis and Shelby County Industrial Development Board of plans to open a new facility a few blocks from its current site, on Holmes Rd. Furthermore, Flextronics will expand its existing site, the Memphis Business Journal reported.

Flextronics has earmarked $2 million for the projects, and add a reported 151 new jobs.

MOUNTAIN VIEW, CA – A just-released survey of some 85 senior-level executives at semiconductor companies finds a majority sees R&D and capital expenditures decreasing significantly next year.

As economic conditions and consumer spending continue to deteriorate, semiconductor executives are turning more pessimistic, and anticipate a steep decline in profitability during the next 12 to 18 months, says the consulting group that conducted the survey.

SAN JOSE – The MicroElectronics Packaging and Test Engineering Council in February will sponsor a symposium on semiconductor packaging’s effect on consumer electronics.

The technical event will address packages for consumer products, with session topics including time-to-market and consumer semiconductor packaging; cost-of-ownership challenges for consumer products; solutions for consumer product miniaturization, and advancing technologies for consumer electronics.

It takes place Feb. 19 in San Jose. For more information, visit www.meptec.org.